A hybrid approach for taking a trading platform to the cloud

Today, capital markets players are seeing rapid increases in trading volumes, market volatility, and in the demand for real-time, cross-portfolio risk analytics and regulatory reporting. Together, these trends are intensifying the urgency of moving away from rather inflexible, cost-laden on-premise infrastructures towards high-performance compute (HPC) infrastructures on Cloud which are capable of executing increasingly heavy workloads.

Most firms are fully aware of this imperative. We’ve already seen some of our clients respond by embarking wholeheartedly on their journey to cloud—seeking to embolden their existing trading platforms with dynamic compute capacity capabilities, while also achieving granular control over their infrastructure spend all in one go.

For firms, that—for whatever reason—can´t consider a full move to cloud in one go, a viable option might be to leverage a hybrid on-premise/cloud solution as a stepping-stone to a full migration to the cloud.

The benefits of a hybrid cloud approach for trading platforms

Why should firms adopt such an approach? Our experience suggests that using a hybrid cloud solution could enable a firm to capitalize on the power of cloud while also limiting and controlling potential implementation risk. The main advantages boil down to three main benefits:

#1: EXPEDIENCY

In the move to cloud in a hybrid approach, firms could start by initially migrating only their heaviest and most compute-intensive workloads—with everything else staying on-premise for the time being. This would accelerate the path to increased compute capacity for mission-critical tasks whilst avoiding the potential disruption that lifting an entire platform off-premise at once might bring.

#2: SIMPLICITY

A further benefit is simplicity. Migrating an entire trading platform to cloud usually is a highly complex task—mainly because of its myriad interconnections and interdependencies with other systems, both internal and external. A hybrid approach could reduce this complexity by enabling a firm to navigate the migration in a phased and measured way at its chosen pace.

#3: A BLUEPRINT FOR SUCCESS

Moving only selected functionalities to start with could also serve as a blueprint and learning opportunity for the remaining journey to cloud and other potential cloud adoption projects. By putting only select workloads into the cloud at first, project teams can leverage lessons learned when migrating more complex components or functionalities later, while continuing to decrease the on-prem footprint over time.

Mapping out the route

The key to success of moving a trading platform environment to the cloud is to identify the right approach. This decision depends on factors such as a platform’s inherent cloud readiness, the impact on already ongoing business change initiatives, anticipated regulatory requirements, and the expected performance of the target solution.

One key benefit of cloud in a trading platform context is the ability to dynamically scale up and down the compute capacity. There are many advantages of scalability, ranging from enhancing model validation testing to fine-tuning production performance and reducing cost. A hybrid cloud approach could allow seizing these advantages while limiting and controlling potential implementation risk.

Whether firms use a hybrid or full cloud approach, they should look to adapt their trading platforms to leverage the advantages of cloud infrastructure today. Did I pique your interest? Then please feel free to reach out to me directly. I am happy to set up some time to discuss.